Coronavirus and Franchising: Paul Pickett of Wild Birds Unlimited and Ryan Zink of Franchise Fast Lane

The coronavirus continues to have dire effects on businesses across the country, and the franchising industry is no exception. Franchisors across segments are strategizing new ways to support their franchisees, keep customers satisfied, help local communities and come out stronger on the other side of this crisis.  

To that end, 1851 Franchise publisher Nick Powills and Charles Internicola, founder and partner of the Internicola Law* Firm, are covering the coronavirus and its impact on the franchising industry through a webinar series titled “Coronavirus and Franchising: Mindset + Strategy to Recover and Grow.”

In today’s afternoon webinar, Powills and Internicola spoke with Franchise Fast Lane CEO Ryan Zink and Wild Birds Unlimited* CEO Paul Pickett to discuss how their brands have pivoted to better serve customers and franchisees. 

Here are some of the key insights from their discussion.

The New Franchise Development

Smart franchisors will continue to focus on franchise development while adapting to the new circumstances of this crisis. 

It is going to be paramount for franchisors to support existing franchisees first and foremost. How franchisors handle this crisis and how they provide emotional and financial support will undoubtedly be reflected in the validation process for future candidates. The most important thing is making sure existing partners are satisfied with the franchise leadership.

Lead volume may be down, but many franchisors and consultants say the prospect pipeline is increasing due to an influx of experienced entrepreneurs and mid-level executives looking for new opportunities. Brands may get less inquiries, but it is likely that these prospects will be more engaged overall. Good franchisors will be able to take advantage of these higher quality prospects. 

In the past, the franchise sales process was all about urgency. Now, franchisors need to take a more understanding and communicative approach. 

It only takes one lead to get a deal done. Our idea of “lead flow” and “deal flow” may get redefined during this chapter. For example, a cold lead may just be a buyer who needs some time and space to get through this crisis. 

During the 2008 economic crash, lead flow went down and processes became much more thoughtful in order to ensure that prospects had the time and resources to make the right business decisions. Franchisors may have signed fewer deals, but they ended up getting higher quality franchisees in the long run. Overall, better franchisees increase royalty flow, AUV’S and exit numbers. 

While the development timeline may change due to this crisis, the qualifications for franchisee candidates shouldn’t. Quality candidates should be 90 percent done with the decision before being invited to Discovery Day.

Every brand needs to make decisions that work for them. For example, Wild Birds Unlimited is not currently signing new deals and has pushed April 1 deals back to June. 

Franchisors need to be more available than ever to discuss the opportunity thoroughly with franchisees, making sure they understand the risk and have the leadership qualities to succeed. 

Supporting Franchisees

This crisis is not a traditional economic downturn; it is largely fueled by emotion. Keep that in perspective when talking to prospective candidates and established franchisees. Support goes beyond financials — good leadership is about heavy communication and open dialogue. Emotional support is needed to keep the team at top condition. 

We are in the eye of the storm, but brands should take this time to document the story of their support, whether it be with leadership team videos, articles or advertising. Telling the story after the fact may not be as powerful as it is now. For example, Wild Birds Unlimited has started a “Share the Joy” section on the brand’s intranet so franchisees can share stories of how the brand has helped them succeed during this time. 

Franchisors need to provide information on preserving and gaining liquidity, dealing with landlords for rent deferment or reduction, managing through loan programs, gathering best practices with vendors and other resources. 

A company’s core values are incredibly important as a guiding principle for all team members. All business organizations need to set clear expectations for their team members and core values work as a strong foundation.

This crisis will likely be a section on all franchisor’s FDDs at some point. Brands may have to break down Item 19’s in order to provide quarterly detail. 

The Future is Unknown

Leaders should be transparent about the unknowns with their team members. We all have to realize that we are going to come out of this in a very different world. Brands are going to need to adapt to new growth goals in 2020.

The franchising industry has always dealt with the unknown of when the next lead is coming in. Because of this, the industry may be more prepared than others to bounce back from this crisis. 

While this can be a nerve-wrecking time for franchisors, it is important to be appreciative of good health. A healthy and supported community is what makes a franchise system strong.